GUANGZHOU - Despite Beijing's repeated
warning that it would severely punish officials
falsifying economic statistics, the latest figures
show regional officials continue to cook the books
to inflate local economic growth.
According to the National Bureau of
Statistics (NBS), China's gross domestic product
(GDP) grew 10.9% in the first half of this year.
However, the average of GDP growth rates of the 31
provinces on the mainland of China far exceeded
12% during the same period. In real terms, the sum
of GDP figures of all provinces was 804.8 billion
yuan more than the national figure reported by the
NBS.
Data earlier released by the National
Development and Reform
Commission shows that every
province recorded double-digit growth in the first
half of this year, with 23 of them having a growth
rate of higher than 12%. Inner Mongolia attained
18.2%, Jiangshu 15.4%, Shandong 15.3%, Tianjin and
Guangdong both 14.4%, Zhejiang 14.1%, Henan 13.9%,
Guangxi 13.6%, Hebei 13.5% and Sichuan 13.3%. Only
three province reported slightly growth lower than
the national rate: Yunnan, Ningxia and Gansu.
People may ask: which should be China's
real GDP, the NBS figures or those reported by the
provinces?
"It is common in China that the
mean GDP figure of provinces is higher than the
national one given by the NBS," said Gao Huiqing,
a researcher with the State Council's Information
Center. "For some years, the provinces' mean GDP
growth figures have been some three to four
percentage points higher than the national ones. I
believe that the latter is more reliable because
the NBS is capable of rectifying the errors found
in the provincial reports."
Li Deshui,
former NBS director, had once written to point out
that the discrepancy between the statistical
figures of the local and central governments, a
tendency that is worsening every year, stems from
the authorities' ineffective crackdown on
falsification of statistics by local officials.
Analysts say the fundamental cause of such
a malpractice lies in the problematic statistics
system currently adopted in the country.
Basically, the NBS and provinces use the same
methods to derive GDP figures. Apart from some
difficulties on the technical side, the main
problem is in the attitude and mentality of the
officials when reporting statistical figures to
the central government. Many local officials tend
to try to look right by cooking the figures
according to their needs in order to demonstrate
their performance.
The system-related
causes of such malpractice are twofold: 1)
Inasmuch as the GDP figure is a "yardstick" to
measure the performance of local officials, there
is a strong motive for them to manipulate the
statistics; 2) The local governments are given the
power to do so.
The data that are most
easily falsified by local officials are those in
the category of the so-called "soft" information,
such as the amount of investment. Another common
falsification is duplicate calculation of
industrial output, which also constitutes an
important part of the GDP. In many regions, trade
figures are taken into calculation of the local
GDP figures, causing it to become unjustifiably
higher.
The current statistics system in
China is working by the principle of "diversified
responsibility under a unified leadership", by
which the NBS claims the nominal leadership, while
the all-important matters regarding personnel
affairs and allocation of financial resources are
held fast in the hands of the local governments.
Thus local statistics officials would be more
obedient to their local governments than to the
NBS.
To overcome this, Qiu Xiaohua, the
current NBS director, now sets a task to screen
out all false information and the bureau is
working on measures for this purpose. In the hope
of eliminating the possibility for local officials
cooking the books, the NBS's long-term goal is to
let economic statistics in any given place be
calculated directly by the higher authority. For
instance, economic data in a province will be
directly calculated by the NBS, and figures in a
city calculated by the provincial statistical
authority.
In a conference in May, Qiu
first advocated reform in the current system,
saying that the key to ending fraudulent reporting
was to make statistical work independent of local
governments' influence. Analysts have pointed out
that falsification of economic statistics could
bring disastrous consequences for China.
By falsifying figures, the local
governments will suffer a credibility crisis among
the public. Some social organizations may take
advantage of this to spread more false information
to confuse the public for their own interests, and
people may also be deceived by false figures
masquerading as true and scientific.
Furthermore, major decisions on
macro-economic policy may be led astray on account
of falsified information deviating heavily from
reality. As some put it, the risky situation is
just like "a blind man riding on a blind horse on
the edge of an unfathomable abyss".
In
short, infidelity in statistics is not only a
problem of expertise or technicality, nor is it
just one of economics and society. It is an
unmistakable symbol of unsound political ecology.
As long as the performance appraisal of officials
by the GDP yardstick and the promotion of
officials based on economic statistics is not
banished, as long as the liars and cheaters are
not punished, as long as those who dare to expose
officials' falsification of economic statistics
are suppressed, it is impossible to get rid of
statistics falsification and its disastrous
consequences.
David Pan is a
freelance writer based in Guangzhou.
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